Pound Advances From This Month’s Low After Home Prices Increase

The pound strengthened to a nine- month high against the euro as concern the region’s debt crisis will worsen boosted demand for the relative safety of the U.K. currency.

Sterling reversed a gain versus the dollar and gilts pared a decline. Fitch Ratings yesterday joined Moody’s Investors Service and Standard & Poor’s in warning it may cut the credit ratings of euro-area nations.

The pound climbed 0.5 percent to 84.19 pence per euro at 4:06 p.m. London time, the strongest since Feb. 22. It fell 0.4 percent to $1.5515 after climbing 0.3 percent.

A gauge of housing compiled by the Royal Institution of Chartered Surveyors rose to minus 17 percentage points from minus 24 points in October, the group said by e-mail today.

Ten-year gilt yields climbed four basis points to 2.14 percent, while two-year yields added two basis points to 0.38 percent.

The FTSE 100 index of shares jumped 1.1 percent and the Stoxx 600 rose 0.5 percent.

To contact the reporter on this story: Lukanyo Mnyanda in Edinburgh at lmnyanda@bloomberg.net; David Goodman in London at dgoodman28@bloomberg.net

To contact the editor responsible for this story: Daniel Tilles at dtilles@bloomberg.net

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